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ICBC Issues Three Tranches of CDB Financial Bonds Simultaneously on January 31
 

Industrial and Commercial Bank of China (the “Bank” or “ICBC”) sold three tranches of China Development Bank (CDB) bonds, i.e. the first and second tranches of CDB financial bonds in 2018, the ninth tranche of CDB financial bonds in 2017, to individuals and non-financial institutions.

It is reported that the first tranche of CDB financial bond in 2018 reissued for the first time in the over-the-counter (“OTC”) market is a one-year fixed-rate coupon bond, with a bond name of 18 CDB 01, a bond code of 180201 and a par value of RMB100. Its value date, redemption arrangement, coupon rate, and trading and custody methods are the same as those of the CDB bonds of the same tenor issued previously. Its coupon rate is 4.14%, and reissue price is RMB100.12 per RMB100 par value, and the reference yield to maturity corresponding to the reissued price is 4.1167%. The second tranche of CDB financial bond in 2018 newly issued in the OTC market is a two-year fixed-rate coupon bond, with a bond name of 18 CDB 02, a bond code of 180202 and a par value of RMB100. The bond carries a coupon rate of 4.53%. The ninth tranche of CDB financial bond in 2017 simultaneously reissued for the third time in the OTC market is a three-year fixed-rate coupon bond, with a bond name of 17 CDB 09, a bond code of 170209 and a par value of RMB100. Its value date, redemption arrangement, coupon rate, and trading and custody methods are the same as those of the CDB bonds of the same tenor issued previously. Its coupon rate is 4.14%, and reissue price is RMB100.36 per RMB100 par value, and the reference yield to maturity corresponding to the reissued price is 4.6873%. Customers may subscribe for the two tranches of reissued bonds via ICBC’s e-banking channels and outlets. Specifically, the e-banking channels provide 24-hour non-stop trading during the issue period.

Sources from the ICBC pointed out that the introduction of such reissuing mechanism for OTC CDB bonds will make OTC market more tailored to the issue rules of interbank market and enhance bond liquidity. Customers can take the market opportunity to resubscribe for the bonds held during the issue period, so as to actively manage investments. Since CDB bonds were issued over the counter in the outlets of commercial banks in May 2014, ICBC has issued 32 OTC CDB Bonds in a normalized manner. The normalized issue and reissue of OTC CDB bonds indicate that the OTC bond market of commercial banks is playing an increasingly important role in bond distribution channels and that it is of importance in expanding the issuer’s financing channels, cutting financing cost and building a multi-tier bond market system.


(2018-02-22)
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